Tibet bottled water brand targeted in new campaign

Thursday, 2 June 2016

London protest as investors in Chinese company challenged over exploitation and environment damage

London - Tibet campaigners today launched an international campaign to persuade investors in a Chinese company bottling water in Tibet to sell their holdings. International campaign group Free Tibet is calling for divestment because of the threat to Tibet’s water resources posed by the rapidly expanding bottled water industry and to highlight the commercial exploitation of Tibetan natural resources by Chinese companies. The campaign began with a peaceful protest outside the London office of BlackRock, an institutional investor in Tibet Water Resources Ltd, maker of the prestige Tibet Spring 5100 bottled water brand (pictures, 1; list of investors, 2). A trust belonging to the family of US Secretary of State John Kerry has also been identified as an investor (3).

Tibet Spring 5100 has been bottled in Tibet since 2006 and was the “official drinking water” of the 2007 National Congress of the Communist Party of China and the 18th Party Congress in 2012 (4) – the venue for Xi Jinping’s accession to the leadership of the party. From 2011 to 2013, the company was in receipt of government subsidies worth more than 360m yuan (5). In 2015, its longstanding commercial relationship with the state-owned China Railway Corporation, which at one point was buying 90% of Tibet 5100’s output, came to a sudden end amid rumours of corruption (6). The company boasts of a 60 square kilometre “water protection zone” around its bottling site north of Lhasa, in which grazing is not permitted and human activity limited (7).

Tibet’s water resources are under increasing pressure from a range of natural and man-made challenges. A recent study by the Chinese Academy of Sciences found that the glaciers in Tibet have shrunk by 15% over the past thirty years and, according to one Tibetan scientist, are melting faster now than at any time previously. It is predicted that if the glaciers continue to melt at this rate, two-thirds will disappear by 2050 (8). Meanwhile, Chinese commercial and government projects, including damming for hydropower and water diversion are making irreversible changes to Tibet’s hydrology. Almost every major river in Tibet is dammed, with more than 100 dams and cascades built or planned across the Tibetan Plateau (9). According to Jennifer Turner, director of the China Environment Forum at the Woodrow Wilson International Centre:

“The Tibetan water tower cannot support all the damming and the extracting that is taking place right now. Bottled water doesn’t have nearly the impact that dams and water-intensive industries do, but it’s another big drop being taken out of the bucket.” (10)

The highly marketable purity of Tibetan water is also under threat from other forms of resource extraction, including mining for copper, gold and silver. Many of these industries simultaneously depend on water usage and generate water pollution, including arsenic, sulfuric acid, mercury and other heavy metals (11, 12, 13).

In 2014, under an initiative called “Sharing Tibet’s water with the world”, the regional government of the Tibet Autonomous Region (TAR) signed contracts with sixteen major companies intending to bottle Tibetan water. In November 2015, the TAR government announced a new ten-year plan to expand the industry, with a target of producing 10 million tonnes of bottled water by 2025 (14). The expansion – more than a thirty-fold increase over the capacity in 2014 – is being incentivised with significant tax breaks to companies and a lower extraction fee than elsewhere in China.

The exploitation of Tibetan resources is a consistent source of conflict between Tibetans and the Chinese government and Chinese businesses. Tibetans dispute the right of China to dispose of Tibet’s natural resources, oppose the consequent environmental damage and pollution and are often faced with dams, mines and other projects on sites with religious significance. More than 14 major protests have taken place since 2012, a number of which have been broken up with force and the use of live ammunition (15).

Free Tibet director Eleanor Byrne-Rosengren said:

“China is plundering Tibet for natural resources from rare earths to the most basic and essential of all. Tibet’s water is not an infinitely renewable resource and thanks to melting glaciers and China paving Tibet’s mountains with dams, now is the worst possible time to turn it into a consumer product. The bottled water ‘gold rush’ in Tibet isn’t just a scramble for profit but threatens the hundreds of millions of people across Asia who depend on water from the Tibetan Plateau. The rights of those people and the Tibetans to whom this resource rightfully belongs are being swept aside.

“No business operating in Tibet can be untainted by the Chinese government’s occupation and repression and the word ‘Tibet’ in a company’s name should be a red flag to any investor. Any Chinese business which is exploiting Tibetan natural resources at the behest of China’s government is also party to theft on a grand scale and is embedded in the destruction of Tibet’s unique natural environment. We’re providing investors with the facts so they can get their money out of this business. Every company we can identify investing in Tibet Water Resources will be hearing from us and from our supporters soon. We hope they will all do the right thing.”

Free Tibet contacted an initial eight shareholding institutions in May, one of which has confirmed that it no longer has a holding (16). US Secretary of State John Kerry was also contacted and has yet to respond (17). Other institutions will be contacted as the campaign develops.

Further information about the bottled water industry in Tibet is available in the Free Tibet briefing Bottled water in Tibet

(6) According to an anonymous source quoted by news website Sina, “halting the commercial partnership between 5100 and Railway is an action carried out to limit the corruption within the railway system. […] In the current atmosphere of repressing corruption in China, this kind of action was to be expected.” http://finance.sina.com.cn/chanjing/gsnews/20150727/105822799679.shtml

(16) See list above (note 2). Schroder Investment Management has confirmed to Free Tibet that it no longer holds shares. Acknowledgment but no reply has been received from Dimensional Fund Advisers; non-committal reply from Norges Bank Investment Management. Mutual funds and newly-identified shareholders will be contacted by Free Tibet soon. Copies of correspondence available from Free Tibet.

(17) Copy of letter to Secretary Kerry, 17 May 2016, available from Free Tibet.